Sam's Club's promise of rock-bottom prices is a draw for independent vending operators, especially in times when every penny added to their bottom line is essential to running a profitable operation. The warehouse club is also finding that more vending professionals hit by the economy say they're managing their cashflow by using its stores as their "warehouses" by buying only what they need as they need it.
Sam's officials say they understand the pressures small businessmen face and are making every effort to stock what they need and help them get in and out of its stores quickly so they can get back to business. Exemplifying the necessity for a speedy and effortless shopping experience are owners of one-person vending companies who are visiting their local Sam's store as many as two or three times a day to purchase only the items that have sold out of their machines, and those who are stocking their trucks at different Sam's stores along their routes in order to warehouse as little product as possible.
"These days, many people are running their business hand-to-mouth and replenishing the minute they need to. Shopping at Sam's allows them to not tie up their cash and help manage their inventory and cashflow," said Secaucus, NJ, Sam's Club grocery manager Frank Castrada. "We have seen a spike in business because shopping at Sam's allows customers to buy smaller quantities only as needed. They generally have higher minimum order requirements with other suppliers and have to pay cash for it on delivery, which is not the easiest thing to do these days."
From confections, salty snacks, soft drinks and individually wrapped pastries, to coffee, hot beverage cups, lids, stirrers, sweeteners and creamers, Sam's carries a wide inventory of vending and OCS supplies. The warehouse club assures operators that the products it has identified as the core top sellers in every category will always be in stock. It also rotates items in and out frequently to help vendors keep variety fresh and consults frequently with its customers to ensure it is on track with the right product mix.
"We work with business owners to find out what they want so they can be first to market with new products. And we have a sampling program so they can try new items risk free when we bring them in," said vice-president of small business insights Catherine Corley. "We regularly send our store managers out to spend a day with customers and work in their businesses; it's part of our culture to understand what they do. We also have a research panel of members that gives us monthly feedback. And we encourage our associates to regularly ask small business members what's good and what could be better, and we listen."
PHOTOS: At left, order awaits Sam’s Club small business member who used “Click ‘N Pull” service to submit an online order by 5 p.m. to have a store associate assemble it for easy pickup the next morning. At right, Sam’s Club vice-president of small business insights Catherine Corley and the wholesale club’s Secaucus, NJ, grocery manager, Frank Castrada, discuss operator feedback on current stock of vendible confections. Below, many independent vending and OCS operators keep inventory to a minimum by shopping at Sam’s as needed for everything from cleaning supplies, single-serve snacks and beverages to coffee cups and stirrers.
Corley pointed out that Sam's private label "Proforce" line of janitorial supplies, a good fit for office coffee service providers, is among the greatest values it offers its customers and said sales of the cleaning products have been growing by leaps and bounds. She added that beyond vending and OCS, operators who are involved in foodservice have access to a wide range of bulk-packed foods and ingredients, and catering essentials like chafing dishes, linens and flowers.
Castrada said many smaller vending operators purchase 100% of their products at the store he manages, but noted that the majority take advantage of the Sam's prices on specific items and use the warehouse club as one of many suppliers. While price has traditionally been the main reason operators patronize Sam's Club, he emphasized that the company has been successful at adding value by developing a close rapport with its business customers to understand their needs and provide more services to support them.
One of many value-added services Sam's provides to save its customers time and money is a free side-by-side cost comparison between its prices and those of its customers' current suppliers. All that the business member is required to do -- to determine if Sam's is offering the lowest possible price -- is submit their current invoice.
Business members can request a cost comparison in the store or at Sam's Club's recently launched online resource center -- samsclub.com/smallbusiness -- where they can access the many resources available to them. Trade-specific sections on the site, including one dedicated to vending, keep operators up to date on products, equipment and services relevant to their businesses.
Shopping at Sam's is made easier for time-pressed business members through exclusive Gold Key hours on weekdays from 7 a.m. to 10 a.m. and Saturdays between 7 a.m. and 9 a.m. Sam's "Click and Pull" and "Fax and Pull" order-ahead service takes it a step further by enabling operators to submit their orders online or by fax by 5 p.m. and pick them up, assembled and ready to go, the next morning. There is no minimum or contract required to take advantage of the service. Online shopping is also available with next-day delivery.
"When you have one owner, you usually have one shopper who wears multiple hats and doesn't have the time to shop," said Sam's Club vice-president of small business insights Catherine Corley. "We do everything we can to get them what they need and get them on their way."
Those who opt for the premium "Sam's Club Plus" membership -- which costs $100, as opposed to the standard $35 fee -- have the added benefit of the new "e-Values" program. Customized savings are loaded onto their membership cards, based on what they buy most or would likely benefit from purchasing. Members can check their eValues at a kiosk in the store, at the member service desk or online. "Plus" members can also take advantage of the Sam's Club Discover card that pays them 2% cash back on purchases, along with discounts on credit card processing services, travel services and more.
Sam's also leverages its purchasing power to make health insurance and pharmacy benefit plans available to all of its business members with competitive premiums it says are generally far less expensive than they would pay elsewhere.
The warehouse club has simplified the requirements for a business membership by eliminating more than a dozen documents including permits and licenses formerly needed to join. Under the new guidelines, small business owners can obtain a Sam's Club business membership simply by providing a current business card, letterhead or other documents they use to promote or manage their businesses. They can also easily add on the names of employees who shop for them.
Sam’s Club is a division of Wal-Mart Stores Inc. The first store opened its doors in Midwest City, OK, in 1983. Today, Sam’s serves more than 47 million U.S. members, with locations nationwide and in Brazil, China, Mexico and Puerto Rico.